After South Korea tightened regulations on leveraged ETFs, domestic trading volume plummeted by nearly 90%. Retail investors have shifted to US 3x leveraged ETFs, with over $4.6 billion invested in SOXL.

After South Korean financial authorities tightened regulations on single-stock leveraged ETFs, significantly raising the minimum margin requirement and imposing investment caps, the trading volume of single-stock leveraged and inverse ETFs listed in South Korea plummeted from KRW 13.04 trillion on July 15 to KRW 1.33 trillion on August 4, a decrease of 89.8%. However, the demand for high-risk investments did not subside but rapidly shifted to the U.S. market. According to data from the Korea Securities Depository, from July 16 to August 3, the top overseas stock purchase settlement by South Korean individual investors was Direxion Daily Semiconductor Bull 3X (SOXL), reaching USD 4.636 billion. During the same period, purchases of ProShares UltraPro QQQ (TQQQ) amounted to USD 393 million. Analysts point out that restrictions on domestic products have led investors to hold overseas products that include exchange rate risk and higher leverage multiples, causing their actual risk exposure to increase rather than decrease. This demonstrates a clear "balloon effect" of the regulation, raising questions about its policy effectiveness.